Page 194 - GSTL_14th May 2020_Vol 36_Part 2

296 GST LAW TIMES [ Vol. 36
L.M.L. Ltd. v. Commissioner — 2010 (258) E.L.T. 321 (S.C.) — Referred ..................................... [Para 11.3]
Parle Agro (P) Ltd. v. Commissioner of Commercial Taxes
— 2017 (352) E.L.T. 113 (S.C.) — Distinguished .......................................................... [Paras 7.4, 17.3]
DEPARTMENTAL CLARIFICATION CITED
C.B.E. & C. Circular No. 309/25/97-CX, dated 21-3-1997 ..................................................... [Paras 7.9, 18.2]
REPRESENTED BY : S/Shri B.L. Narasimhan, Anand Nainawati, Advo-
cates and Hamit Kumar Luthra, for the Assessee.
[Order]. - The appellant-M/s. Hindustan Coca-Cola Beverages Private
Limited has submitted that it is engaged in the manufacture of aerated drinks
and fruit pulp or fruit juice based drinks under different brand names, classify-
ing the same under Chapter 22 of the First Schedule to the Central Excise Tariff
Act, 1985/Customs Tariff Act, 1975.
2. The Appellant commenced manufacturing of a new product “Fanta
Fruity Orange” on 10th August, 2017 and made first supply of the said product
on 24th August, 2017. The appellant submitted that the major ingredients for the
manufacture of “Fanta Fruity Orange” are Orange Juice consisting 10.5% fruit
juice content, Carbonated Water, Sugar, Acidity Regulators, Preservatives, Stabi-
lizers, Sweeteners, and Synthetic Food Colour. The manufacturing process starts
with procurement of Orange juice concentrate from approved vendor and stored
in - 18C cold storage which forms the base of product. This juice concentrate is
then blended with sugar syrup which is prepared by mixing granulated sugar
with treated water, additives and preservatives to form the beverage. Thereafter,
this beverage is carbonated before being filled in bottles. It has submitted the de-
tails of the ingredients used for the manufacture of “Fanta Fruity Orange” and
the process involved for manufacturing of the said product.
3. The appellant filed an application for Advance Ruling before the Gu-
jarat Authority for Advance Ruling (hereinafter referred to as the ‘GAAR’) and
sought ruling on following questions -
Whether “FANTA FRUITY ORANGE” product is classifiable under CH
2202 99 20 at Sl. No. 48 under Schedule-II as “Fruit pulp or fruit juice
based drinks”, or under CH 2202 99 90 at Sl. No. 24A under Schedule-III
as “Other non-alcoholic beverages” or under 2202 10 at Sl. No. 12 under
Schedule IV as “All goods [including aerated waters], containing added
sugar or other sweetening matter or flavoured” under Notification No.
1/2017-Central Tax (Rate), dated 28-6-2017 (as amended) and Notifica-
tion No. 1/2017-State Tax (Rate), dated 30-6-2017 (as amended)?
4. The appellant submitted that the product “Fanta Fruity Orange”
with 10.5% Orange juice, would be classifiable under Tariff Item 2202 99 20 as
“Fruit pulp or fruit juice based drinks”. It submitted that “Fruit pulp or fruit juice
based drinks” are specifically covered under Tariff Item 2202 99 20 under the
sub-heading 2202 99 which covers other non-alcoholic beverages.
5.1 The GAAR, in Advance Ruling No. GUJ/GAAR/RULING/
07/2019, dated 30-3-2019 [2019 (28) G.S.T.L. 518 (A.A.R. - GST)] has observed
that as per the label of the product, Orange Juice Concentrate is 1.6% of the
product and that the Orange Juice is reconstituted out of this Orange Juice Con-
centrate. It has been observed that the terms used in the said tariff item is ‘Fruit
pulp’ or ‘fruit juice’ based drinks and the said entry do not refer to the term
‘Fruit juice concentrate’ based drinks. Therefore, the said entry would cover the
GST LAW TIMES  14th May 2020  194